Washington, D.C. - The Distilled Spirits Council today applauded the decision by a World Trade Organization (WTO) dispute settlement panel, which concluded that the Philippines’ discriminatory excise tax on distilled spirits violates WTO rules. Further, the Council urges the Philippine government to revise its excise tax structure immediately to comply with the ruling.

The WTO action followed the U.S. government’s decision in January 2010 to launch a formal WTO dispute against the Philippines’ excise tax regime.

“For well over a decade, the Philippines has discriminated against imported spirits by assessing a tax that can be as much as 43 times greater than the tax rate applied to domestically-produced spirits,” said Peter Cressy, President of the Distilled Spirits Council, a national trade association representing producers, marketers and exporters of distilled spirits products. “With a trade barrier of that magnitude, it is no wonder that U.S. spirits have barely made a dent in the nearly $3.4 billion Philippines spirits market.”

Cressy stated, “We urge the Philippines to abide by the ruling and quickly replace its current regime with a fair, non-discriminatory excise tax system.”

In 2010, U.S. distilled spirits exports to the Philippines were valued at just $997,000 (FAS export value); globally, U.S. spirits exports surpassed $1 billion for the fourth consecutive year.

“Given the facts, it should come as no surprise that the WTO panel has again upheld fundamental WTO rules prohibiting discriminatory treatment of imported products,” Cressy said. “We are extremely grateful to the U.S. government for its efforts over the years to resolve this dispute with the Philippines and applaud this successful outcome.”